XRP Price: Is a $3.40 Surge Possible? Here’s Why

Is XRP setting the stage for a significant move? The popular altcoin has captured the attention of the crypto market with signs pointing towards a potential retest of its multi-year high around $3.40. Let’s break down the factors fueling this optimism for the XRP price.

Why is Rising XRP Open Interest a Bullish Sign?

One key indicator supporting a positive outlook for the XRP price is the significant increase in its futures Open Interest (OI). Open Interest represents the total number of outstanding derivative contracts, such as futures or options, that have not been settled.

• Between May 8 and May 14, XRP futures OI surged by 53%, climbing from $3.61 billion to $5.53 billion.
• Although it saw a slight dip to $5.06 billion recently, this substantial rise alongside price recovery signals growing bullish sentiment among traders.
• Historically, periods of increased OI have often preceded notable rallies in the XRP price. This pattern suggests traders are opening new positions, betting on further price appreciation.

While funding rates for XRP have turned positive, they remain relatively neutral around 0.0065%. This indicates that despite the growing speculation reflected in OI, the market isn’t currently overheated with aggressive long positions, suggesting a more balanced, albeit optimistic, sentiment.

What Does the XRP Price Chart Reveal?

Analyzing the weekly XRP price chart reveals a compelling technical formation: a V-shaped recovery pattern. This pattern typically forms when an asset experiences a sharp decline followed by an equally sharp and sustained recovery.

A V-shaped recovery is confirmed when the price breaks above the resistance level at the top of the ‘V’, often called the neckline. For XRP, the potential neckline sits around the $3.40 mark. The current price action appears to be tracing out this bullish trajectory.

What Are Key XRP Price Levels to Watch?

For the potential move towards $3.40 to materialize, several critical XRP price levels need to be monitored:

• Holding Support at $2.40: Market analysts highlight $2.40 as a crucial support level. This price point sits above key volume-weighted average prices (VWAPs) and major moving averages. Maintaining ground above this level is essential for sustaining bullish momentum.
• Flipping $2.60: Bulls need to successfully flip the $2.60 level from resistance back into support. Establishing a solid base above $2.60 would increase the probability of a move towards the next target.
• Targeting $3.00: After securing $2.60, the next logical resistance and psychological target for the XRP price is $3.00.
• The $3.40 Neckline: A decisive break above $3.40 would complete the V-shaped pattern and potentially confirm the continuation of the bullish trend, representing a significant percentage increase from current levels.

Technical indicators like the Relative Strength Index (RSI) also support the bullish case, having risen from 43 to 56 recently, indicating strengthening buying pressure.

Analyst Views on XRP Price Prediction

Several crypto analysts have offered optimistic XRP price prediction targets based on technical setups.

• Analyst Egrag Crypto points to a breakout from a descending triangle pattern on the daily chart, suggesting this could pave the way for the XRP price to retest the $3.40 zone.
• Market analyst Dom emphasizes the importance of the $2.40 support level, noting that XRP saw a clear break above VWAP bands recently but stalled near the value area high. Defending current levels is key for immediate structure integrity.

These expert opinions reinforce the potential outlined by the technical patterns and market indicators.

In conclusion, the combination of rising Open Interest signaling bullish sentiment, a clear V-shaped recovery pattern forming on the charts, and key support levels holding firm presents a compelling case for the XRP price to continue its upward trajectory. While challenges and market volatility always exist in the crypto market, the path towards retesting the $3.40 high appears increasingly viable based on current data and analysis.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.